Friday, March 9, 2012

Shortages

When I first arrived in Malawi in late January, I would see the occasional queue of cars at gas stations. The queues disappeared for a while, and returned with a vengeance about two weeks ago.

Driving... is that a queue on the left? But there's no gas station around here...

The fuel queues are mostly a result of the foreign exchange (forex) shortage (if you wanted to travel to Malawi, now's the time: bring US dollars!). An overvalued currency and a trade imbalance have led to a serious shortage of foreign currency with which to import things like fuel. (I mean serious: I'm working for a financial institution, and they can't acquire enough foreign currency to send employees travelling abroad.)

Following the queue...

The official bank exchange rate is 170 kwacha for 1 US dollar, and so far the highest I've been offered on the black market is 300 kwacha for 1 US dollar. A news article from earlier this year sums up the state of things. (Since that article was written, the government has rejected those initial calls to devalue, but the debate about whether to do it continues).

600m+ down the road, I reach the gas station that's the source of the queue, and almost get stuck in the traffic jam there.

So what you do you do if you need fuel? Queue for hours (if not days, at this point) and hope you luck out and the station you're parked at gets a delivery... or turn to the black market!

This is probably terribly unsafe.

I'm told fuel is going at around 6$ a liter now on the black market. Of course, there's no guarantee that what you're buying is proper fuel (I imagine you can be fairly certain of the opposite). And despite the illegality of reselling fuel like this, the above picture of our shady black market fill-up was taken approximately 20 meters away from a legitimate gas station (which, of course, was out of fuel).